Turning Around a Failing PMO

Whether you’re a project manager or a C-level executive, PMO failure can spell disaster for a business, and possibly even your career. Failing project management offices translate to wasted resources and missed opportunities for a business—and if someone is trying to assign blame for project failure, you could be put directly in the line of fire.

But there’s no need to panic—yet. By knowing the key warning signs of a PMO in trouble and implementing some quick fix action steps, you can stop PMO failure in its tracks.

To start turning things around at your PMO today, keep reading: you’ll learn the difference between PMO success and failure, the classic signs of a PMO on the brink of disaster, and basic strategies for fixing your PMO for good.

What makes a successful PMO?

A quick refresher on what makes a successful PMO can help you see where your own project management office is falling behind.

A successful PMO:

Has a clear mission statement at its foundations and is driven by realistic goals

Provides visibility, governance, and regular communication

Is perceived by the rest of the organization as critical for meeting business goals

Uses reliable and transparent methodologies for project management

Delivers measurable results of their accomplishments

Focuses outwardly on business needs and not internally on their own processes

Has clear and open relationships through the organization, from executive sponsorship and stakeholder partnership to effective team management.

How does your PMO compare?

Why do so many PMOs fail? It’s all about value

While it’s important to know what makes a successful PMO, it’s impossible to ignore the alarming statistics surrounding project management office failure: PMOs have the highest failure rate of any department in an organization, with an astounding 50% of PMOs closing within the first 3 years.1

Why do so many PMOs fail?

PMO failure is almost always attributed to a lack of executive support, a misalignment with company strategy, a poorly defined mission, and unclear objectives.

While these can be contributing factors, the core cause of PMO failure has little to do with the tools, processes, or the people.

If that sounds hard to believe, consider the recent study by Forrester Research2 outlining the 3 most significant PMO problems.

Lack of trust. 58% of stakeholders believe the information from their PMOs is realistic

PMOs are too busy to be trulystrategic. 75% of surveyed PMOs do hands-on project management 68% of stakeholders perceive their PMOs to be bureaucratic

What does all of this mean?

Simply put, it means that PMO failure isn’t just about project management. In reality, PMOs fail because they do not demonstrate a measurable value-add to the business.

Project success rates aren’t enough. Even a 100% success rate can be deemed a failure if the PMO’s business value is not communicated to leadership in in terms that they recognize as critical.

Warning signs of a troubled or failing PMO

The classic warning signs of a PMO in trouble further support the idea that failure is directly linked to the perceived value of your project management office.

Do any of these warning signs sound familiar?

The business doesn’t see value in the PMO’s activities: You’re constantly questioned by leadership about what you do, and are rarely recognized for the positive results your PMO delivers.

The PMO’s mission, vision, and objectives don’t support the organization’s strategy: You’re unsure of the business goals and objectives that your PMO is supposed to be meeting. You’re not even 100% certain that your PMO is working on exactly what the business expects.

The PMO is seen as the “project police.” Your PMO is constantly getting a bad wrap for enforcing methodologies and processes—some even complain that you do so at the expense of serving the business.

The business avoids the PMO and its processes. On more than one occasion you’ve discovered that others in the organization have avoided working with you because they don’t like your processes.

Other departments complain that the PMO doesn’t understand the business. Other departments are vocal in their belief that your PMO doesn’t understand how their business or industry works.

Low project success rate. Your project success rate is consistently low, mostly because of ill-fitting processes and bad tools, which have caused you to lose control over and visibility into projects.

Poor performance of the project portfolio. The performance of the project portfolio is always lackluster, for the same reasons as your low project success rate: bad processes and tools have gotten you off track, creating a gap between execution and strategy.

Are these warning signs present in your PMO? If so, tread carefully.

After all, it’s not just projects on the line.

The above scenarios have occurred because you’ve failed to demonstrate your value to the business—and that ultimately puts your entire PMO at risk.

PMO failure: Get help with these quick fixes

There are several quick fixes that can help failing PMOs effectively turn things around. These corrective steps can help you illustrate your PMO’s value to the rest of the business, and fend off trouble before it does permanent damage to the perception of your PMO.

These steps often translate to a PMO “do-over.” This sounds daunting, but it’s well worth it: the proper corrective action can make the difference between the failure or survival of your PMO.

Start by going back to the basics. Ask yourselves the hard questions to figure out what went sideways. Once you’re able to identify the problem, you’ll be able to find the solution.

Here are some helpful ways to get your PMO on the road to recovery.

Reevaluate the needs of the business. Almost 80% of project management executives don’t know how their projects align with their company’s business strategy. Bridging this gap between the PMO and the rest of the organization is a must if you want your PMO to survive.

Start by regularly connecting with business leaders to ensure that the PMO success metrics align with the business goals, and that your projects consistently map back to operational efficiency and business value.

Adopt an outward focus on business needs. Remember that the PMO was created to serve the needs of the business. When the rest of the organization doesn’t understand why your PMO exists, it’s likely because the PMO’s mission hasn’t been effectively and repeatedly communicated.

You can start communicating your value by making your achievements clear to everyone: ask to present an update at the next company meeting, contribute project milestones to the intranet news page.

Build and maintain trust through open communication and honest reporting. Does your reporting provide a true and complete picture at all times? Are you going beyond mere statistics by communicating your actual value? Do you link your PMO’s success metrics with established business needs? These are crucial to presenting your PMO as an invaluable and collaborative part of the organization.

Immediately implement steps to raise your project success rate. After establishing communication with leadership and confirming the business needs and goals, the next step is to raise your project success rate. Work with your team to establish a process to determine when to cut projects that aren’t working. Eliminating doomed projects does not mean that you have failed—rather, it raises your project success rate (in the short-term), and provides further opportunity to show the business your value. Align the elimination of a bad project with business goals, and communicate it to leadership in a language they understand: How much did the company save? What resources were freed up? Were any costs avoided?

Take a minimalist approach to processes and tools. Complete an audit of your project tracking tools to ensure your toolkit meets the needs of your organization. While needs will shift depending on your organization’s maturity, you should have access to real-time insights into your resources and a big-picture view of your current projects.3

Preventing PMO failure: Always show your value

The biggest challenges PMOs face have little to do with project management and much more to do with delivering—and demonstrating—value to the business.

Rescuing your failing PMO will not only make you an operational success, but will also lead you and your team to be recognized as a vital organizational asset that consistently provides value to the business.

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We’ve been serving corporate businesses with professional services software and IT management solutions for more than 20 years. Our flexible and powerful professional services solution enables growth, financial health and improved efficiency for our global customers. It marries professional services automation (PSA), project portfolio management (PPM) and powerful business analytics to provide total operational visibility and control over their strategic business portfolios.